Reply to Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?

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Reply to "Vanguard Target Date funds (in taxable accounts) --- WHAT IS GOING ON?"

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[quote=Anonymous]Ok, so we have a substantial amount of money in Vanguard target date funds.  I noticed in Dec. that there was a day when the reported value dropped something like 16%.  I thought it must be a glitch and it would be fixed, as I hadn't heard anything about a market crash like that.

So, I saw that it wasn't ever corrected, but the value of my portfolio didn't change... it was just a large change in the price.  Again, I didn't worry about it b/c I figured it had something to do with the distributions and that affected the list price of the mutual funds.  No big deal.

But, today, when I see the tax statement from Vanguard --- I'm seeing a similar number for the total ordinary dividends (as we had reported last year), but the line for "2a Total Capital Distributions" is $161,000!

Again, that looks a little alarming, but maybe it doesn't make a big difference for my taxes --- OH NO!  IT DOES.  Suddenly, Turbo Tax says we owe $28,000 (!!!).  We didn't do anything but HOLD these two Vanguard Target date funds for the year (and added to them).

WHAT THE HECK IS GOING ON????

This does not seem right or fair.[/quote]

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